Economist: 'more to lose' by not investing in China
02/11/2012
The report, Retail 2022, predicts of how the retail and economic landscape will change over the next 10 years, and expects China, India, Brazil and Russia to be the dominant markets in a decade, with Africa following as the biggest growth story.
By 2022, China is expected to account for around a quarter of the global retail sales generated by the 60 largest markets, twice as much as the US.
While luxury goods groups have recently been criticised for being overexposed in China and at risk in the face of a slowdown, the report says: “In the short term this may be a factor, but considering the weight that these markets will carry in 10 years’ time there could be much more to lose by not investing now. Although double-digit growth for luxury goods firms may be difficult to sustain by the turn of the decade, by 2022 a strong platform will exist in these new markets for luxury goods houses in large and mid-sized cities selling wares to a willing and wealthy consumer base.”
It goes on to say that online and mobile shopping will play a big role in how people shop, and retailers and ‘bricks-and-mortar’ stores will have to respond to keep up. “Forrester, a US-based market research company, is anticipating that between 2011 and 2017 the value of mobile retail transactions will rise elevenfold across Europe. Given the continuing emergence of app-based shopping, this estimate looks conservative and 2022 will see mobile commerce as very much a mainstream means of shopping,” it said.
In the UK, it expects continued polarisation of shopping habits – with consumers favouring discount stores for low-cost goods but also spending on higher value or luxury goods at the top end.
It also predicts many Western brands will become Chinese or Indian owned.
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